EPCG – changes – DGFT amends HOP
As per para 5.3.1 of the Handbook of Procedures (v1) for EPCG Authorisations,
RA concerned shall, on the basis of nexus certificate from an Independent Chartered Engineer (CEC) submitted by applicant in Appendix 32A, issue EPCG authorization.
Now this is changed to
5.3.1 RA concerned shall, on the basis of nexus certificate from an Independent Chartered Engineer (CEC) submitted by the applicant in Appendix 32A, issue EPCG authorisation
and thereafter forward a copy of the EPCG authorisation to the concerned Jurisdictional Central Excise Authority.
So, now the RA has to forward a copy of the EPCG authorisation to the Central Excise Authority. Saves a lot of time and effort.
Para 5.3.2 of Hand Book of Procedure now reads as:
Authorisation holder shall produce to concerned RA a certificate from Jurisdictional Central Excise authority or an independent Chartered Engineer (CEC) confirming installation of Capital goods at factory premises of authorization holder or his supporting manufacturer(s)/ vendor(s) within six months from date of completion of import. In the case of import of spares, the installation certificate shall be submitted by the importer within a period of three years from the date of import.
Now this is amended to read as
5.3.2 Authorisation holder shall produce to the concerned RA a certificate from the Jurisdictional Central Excise Authority, confirming installation of Capital goods at factory premises of authorization holder or his supporting manufacturer(s)/ vendor(s) within six months from date of completion of import. In the case of import of spares, the installation certificate shall be submitted by the Authorisation holder within a period of three years from the date of import. However, in case of units not registered with Central Excise Authorities, the Authorisation holder shall produce to the concerned RA, a certificate from an independent Chartered Engineer confirming the said installation of Capital goods / spares.
The certificate from the Chartered Engineer will now be accepted only in cases of units not registered with the Central Excise Department. DDT understands that even the mighty Reliance had problems in getting these certificates from the mightier Central Excise Department and had outsourced this job to a consulting firm.
Fulfillment of Export Obligation
The new norms for Fulfillment of Export Obligation are
Period from the date of issue of Authorisation | Minimum export obligation to be fulfilled |
Block of 1st to 6th year | 50% |
Block of 7th and 8th year | 50% |
In respect of Authorisations, on which the value of duty saved is Rs.100 crore or more, the export obligation shall be fulfilled over a period of 12 years in the following proportion
Period from the date of issue of Authorisation | Minimum export obligation to be fulfilled |
Block of 1st to 10th year | 50% |
Block of 11th and 12th year | 50% |
Some more benefits:
However, the export obligation of a particular block of year may be set off by the excess exports made in the preceding block of year. The Authorisation holder would intimate the regional authority on the fulfillment of the export obligation as well as average exports within three months of completion of the block, by secured electronic filing using digital signatures.
If you don't export, pay Customs Duty with interest.
Where export obligation of any particular block of years is not fulfilled in terms of the above proportions, except in such cases where the export obligation prescribed for a particular block of year is extended by the competent authority, such Authorisation holder shall, within 3 months from the expiry of the block of years, pay duties of customs (along with applicable interest as notified by DoR) of an amount equal to that proportion of the duty leviable on the goods which bears the same proportion as the unfulfilled portion of the export obligation bears to the total export obligation.
DGFT PUBLIC NOTICE NO. 54 (RE-2007)/2004-2009., Dated: October 1, 2007